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February milk-feed price ratio dips lower


February milk-feed price ratio dips lower
Lower milk prices and slightly higher hay prices offset small declines in corn and soybean prices, pushing the preliminary February 2013 milk-feed price ratio lower. Often debated for its relevance, the index is based on the current milk price in relationship to feed prices for a ration of 51% corn, 8% soybeans and 41% alfalfa hay.
The U.S. average milk price of $19.40/cwt. was down 50¢ from January and the lowest since August 2012. Average prices paid for corn and soybeans in February were down 7¢ and 10¢ per bushel from January, respectively, but hay prices rose to a record high $218/ton.
Current trend: February 2013’s index is the lowest since August 2012, and marks the 23rd consecutive month the milk-feed price ratio is below 2.0. The 2012 average of 1.53 was the lowest annual average since the early 1990s.
Source: USDA/NASS Ag Prices report, Feb. 28